Own-brand names rings the till for Debenhams as profits jump

Debenhams is reaping the rewards of a change in strategy that boosts sales of its own-brand goods.

Analysts expect the store group to this week deliver profits of about £122million, up from last year's £110million, reflecting the higher margins it makes on sales of own-brand ranges in its 144 UK stores.

In the summer, Debenhams began converting more than 530,000 square feet of trading space from concessions to selling its own brands.

Boost: With 144 stores across the UK, Debenhams has a huge High St presence

The switch, now completed, means that about 80 per cent of Debenhams sales are own-brand products.

Leading the change is the Designers at Debenhams range, which
includes John Rocha, Ted Baker, Jeff Banks, Jasper Conran, Janet Reger
and Matthew Williamson.

The chain put concerns about its debt levels behind it in the summer
when it raised £323million through a share placing, though chief
executive Rob Templeman said at the time that some of the cash could be
used for 'opportunistic acquisitions'.

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Observers have speculated that Debenhams might hit the acquisition
trail with fashion brands Karen Millen and Oasis, forced into
administration when Iceland's banking system collapsed, named as
targets. But it is not thought Debenhams will highlight any acquisition
strategy with this week's results.

Shares in the company, whose private equity owners floated it on the
stock market at 190p a share in May 2006, closed last week at 79.85p to
value the group at £10.3billion.